Reuters reports that Dallas Federal Reserve Bank President Robert Kaplan, (voting member for 202, not 2019), on Monday pushed back against dovish calls from some of his fellow U.S. central bankers, saying it is too early to judge if trade tensions and other uncertainties will hurt U.S. economic growth.
- ‘Wise’ to take time to consider if need to change rates.
- Downside risks to U.S. economic outlook have increased.
- Too early to judge if trade, global growth uncertainties will hurt U.S. economic growth.
- Concerned that adding monetary stimulus would contrubute to buildup of excesses, imbalances.
- U.S interest rates ‘in the neighborhood’ of neutral.
- He will monitor U.S. and global economies, financial conditions in coming weeks, months.
- Monthly job U.S. gains of 60,000 to 120,000 would mean ‘strong’ jobs market.
- Tight labor market exerts upward push on inflation.
- Trade tensions likely contributing to softening global growth.
FX implications
The US Dollar is prone to a bid on hawkish comments and offered on dovish comments.
- Fed Quick Analysis: Buying opportunity on USD? Three reasons why the Fed was not dovish enough
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